PhillyDeals: PhillyDeals: How to keep small firms in science center

For 45 years - almost since the University of Pennsylvania drove the entrepreneurial researchers who built the first modern computer away from campus, ending the school's brief reign as the world capital of info tech - the

University City Science Center

, a consortium of Penn, Drexel and other local colleges, has been trying to keep smart, ambitious professors and their for-profit companies in the neighborhood.

Last week, Drexel knocked a block out of the heart of UCSC's 17-acre office-and-lab district along Market Street.

Drexel says it will use $25 million from donor

Richard Hayne

, head of

Urban Outfitters Inc.

, to help

turn the

Venturi Scott Brown

-designed headquarters building into Drexel's new design school.

The property, which for 30 years has been the Institute for Scientific Information, is the one with the distinctive facade that recalls old computer punch cards.

"The sale to Drexel, we heard about after the fact," said

Stephen S. Tang

, who has headed the science center since last year. The center owns only about half the space it helps market in 15 buildings; it had no say in the fate of the ISI building. ISI's successor company,

Thomson Reuters Scientific

, is moving its business out of the neighborhood, to 1500 Spring Garden St.

"The challenge over the years has been that we create companies that flee," Tang told me. "That's the puzzle we've been trying to solve: Why can't we retain the companies? Like Cambridge, Mass., has with their biotech companies, such as

Biogen

and

Genzyme

."

The problem is that small companies have to compete for University City office space with the universities and their affiliates, which lease space throughout the Science Center, and which have expanded enormously over the last four decades.

Office space in University City now leases at a premium to Center City space. That makes it tough for Tang or anyone trying to keep space available for young firms that might or might not expand.

Tang's current tenants include promising start-ups, among them a handful of private-equity-backed medical-technology companies run by scholars affiliated with, or graduated from, Penn.

"They will be outgrowing their space," Tang said. "Their boards would persuade them to use cheap space, which means out in the suburbs. But they've developed a local workforce. They have good reasons to stay here. So we want to create options.

"We have a balancing act on our hands. We have very prominent neighbors - Penn and Drexel and Children's Hospital. They need space.

"I'm not averse to universities taking office space in our campus. But I would like to be directed to functions closer to our mission."

Drexel's design school doesn't look like it fits that mission, at the moment. But Tang has started to consider "new possibilities. We're strong in life science. We have a presence in info tech, nanotech, energy tech. In that whole area of media and communications, we have not had a strong presence."

Maybe the design center's professors and students will, in time, spawn little companies of their own.

Will there be room?

PNC Financial Services Group

shares rose $8 Wednesday, after plunging almost $16 Tuesday, as the Pittsburgh bank, Pennsylvania's largest, said losses from newly acquired

National City Corp.

won't be as bad as feared.

"PNC does not expect at this time to request additional capital under the

TARP Capital Purchase Program

or issue additional common shares," the bank said in its statement.

All bank stocks are down; but if PNC can preserve the premium it enjoyed last year, compared with other bank stocks, it'll be more likely to make the kind of "opportunistic" acquisitions

chief executive officer James Rohr

has said he'll consider.

The

Bank of England's Chris Shadforth

wants our readers to know that, while the British central bank had a role in setting up the "recapitalization" of the

Royal Bank of Scotland Group P.L.C.

and other British banks last year, the British government's 70 percent ownership stake in Royal Bank, which owns

Citizens Bank of Pennsylvania

, "is owned by Her Majesty's Government, and managed through

UK Financial Investments

, not the Bank of England."